When Does an Account Become Uncollectible

question 41

Multiple Choice

When does an account become uncollectible?

• A)when accounts receivable is converted into notes receivable
• B)when a discount is availed on notes receivable
• C)there is no general rule for when an account becomes uncollectible
• D)at the end of the fiscal year

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Definitions:

Supporting Service Expenses

Costs incurred by a business or organization for activities that aid the operation but do not directly contribute to the main business activity.

Not-for-Profit Entity

An organization that operates for charitable, educational, cultural, religious, or other purposes serving the public interest, where profitability is not the primary goal.

Supporting Services Expenses

Costs incurred for activities that assist the core operations of a business but do not directly contribute to production.

Journal Entry

A recording in the accounting ledger that represents a single transaction and its effect on the accounts, consisting of at least one debit and one credit.